Following weeks of Trump administration pressure on the Internal Revenue Service (IRS) to share legally protected tax data that potentially comes from undocumented immigrants, the acting commissioner of the IRS resigned from the agency this week — along with a sizable portion of the overstretched agency’s leadership.
Federal law restricts the sharing of taxpayer data even between agencies of the U.S. government. One section of U.S. tax law stops the Treasury Department from providing taxpayer data for use in civil immigration-law enforcement. According to the Associated Press, tax law experts at New York University warned that “IRS officials who sign off on data sharing under these circumstances risk breaking the law, which could result in criminal and civil sanctions.”
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The administration went over agency leaders’ heads to get access to IRS data — forging an agreement instead between Treasury Secretary Scott Bessent and Homeland Security Secretary Kristi Noem to force the IRS to share information.
Undocumented immigrants pay $66 billion in federal taxes per year, but receive few benefits. Economists and researchers at the Yale University Budget Lab warned that giving IRS data to DHS would scare immigrants from parts of the workforce that participate in the tax system — costing the federal treasury more than $300 billion of lost revenue over 10 years.
People working in the United States without documentation have often paid taxes to demonstrate good moral character — and in the hope of either gaining access to citizenship or preventing deportation. Among benefits that undocumented residents pay into without receiving: Social Security, Medicare, the child tax credit, and the earned income tax credit.
DHS has said it hopes to use information from the IRS to target as many as 7 million undocumented residents of the United States.
- Top I.R.S. Officials Said to Resign After Deal to Give ICE Migrants’ Data [The New York Times]